VIRTUAL WORLD CONSUMER BEHAVIOR DISSERTAION

VIRTUAL WORLD CONSUMER

BEHAVIOR

DISSERTAION

ANGIE M. COX, PHD BA,

TRIDENT UNIVERSITY INTERNATIONAL

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AGENDA

• Motivation, Originality, Significance and Contribution

• Problem Statement, Research Purpose, Research Questions

• Theoretical background

• Model and Hypotheses

• Methodology

• Data Analysis

• Limitations, Implications of the Research

MOTIVATION AND SIGNIFICANCE Understand consumer behavior in Virtual Worlds / fill the knowledge gap

Help businesses succeed in Virtual World markets

Help Information Systems designers and Virtual World developers shape components steer users to purchase

Aid systems research and further clarify Virtual World consumer behavior based on user and systems attributes in order to explore specific markets and products

Explain how Virtual World participants chose to buy intangible products Determine difference in Virtual World consumers versus ‘normal’ shoppers based on their

attributes & motivations

To use Theory of Reasoned Action and Flow Theory together as well as Desire for uniqueness concept as a backbone for a proposed model

Contribution: This study’s findings can significantly impact Virtual World industry and provide valuable information to Information Systems designers; entrepreneurs; Virtual world developers; marketers; and for researchers, overall leading to research advancement and increased Virtual World profits.

PROBLEM, PURPOSE & RESEARCH QUESTIONS

Virtual Worlds are popular and growing. Players spend millions of dollars but there is a lack of information on why. Stakeholders don’t understand what affects a players shopping attitudes and shopping subjective norms and overall their intentions to purchase Virtual World products.

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The purpose of this research is to build and tests a model to explain Virtual World Consumer Behavior by defining the relationships of user attributes such as skill, challenge and their desire

for uniqueness with Virtual World Shopping attitudes and subjective norms and finally with their intentions to purchase Virtual World products.

Are Virtual World user characteristics such as their skill, challenge level and desire for uniqueness positively associated with their Virtual World shopping attitude? Are Virtual World User characteristics such as their skill and challenge level positively associated with their Virtual World shopping subjective norms? (Virtual World social / game-like environment)Do Virtual World shopping attitudes and subject norms positively relate to Virtual World users’ intentions to purchase Virtual World products?

THEORETICAL BACKGROUND

1. Conceptual framework

A. Theory of Reasoned Action (TRA)

B. Flow Theory

C. Desire for Uniqueness concept

2. Hypotheses

3. Virtual World Consumer Behavior Model

TRAStates behavior intention comes from a person’s attitude and their subjective norms (Fishbein & Ajzen, 1975).

- Attitudes are beliefs about the consequences of performing the behavior multiplied by his or her evaluation of these consequences (Fishbein & Ajzen, 1975).

- Subjective norms are a collaboration of perceived expectations about the behavior from those who are important to the individual.

*Pavlou and Fygenson (2006); Yu and Wu (2007): Internet shopping

*Lyong (1998): Choosing to buy a specific brand

*Chi, Yeh and Yang (2011): Smartphone purchases.

TRA MODEL

Fishbein & Ajzen (1975)

FLOW THEORY

Flow theory - Csikszentmihalyi (1990)

• Flow is described as an optimal experience where one is immersed entirely in the situation with great focus and involvement.

• Flow state is determined by two factors: skill and challenge

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FLOW THEORY (CONTINUED)• Flow inconsistencies:

• Dimension (single: Shin, 2006; Pearce et al., 2005); (multiple: Koufaris, 2002; Richard & Chandra, 2005)

• Antecedents vs consequences (Hsu & Lu, 2003 vs Agarwal & Karahanna, 2000), Woszcyznski, Roth & Segars, 2002 vs Richard & Chandra, 2005)

• Ex: perceived usefulness; proficiency

• Flow studies:

• Internet use, internet navigation, internet shopping (Hsu, Chang & Chen 2011; Agarwal & Karahanna, 2000; Lim, 2014; Korzaan, 2003; Hoffman & Novak, 1996)

• Shopping & consumer behavior (Gao & Bai, 2014; Wang & Hsiao, 2012; Siekpe, 2005)

• Gaming enjoyment (Holsapple & Wu, 2008; Hsu & Lu, 2004)

• Brand attitudes (Mathwick & Rigdon, 2004)

• Behavioral intentions, revisit intentions (Luna, Peracchio & de Juan, 2002; Koufaris, 2002)

Because of inconsistencies: Main Factors, Skill & Challenge used, not Flow State

DESIRE FOR UNIQUENESS

• Virtual World users may be drawn to products that self-define or set them apart from others.

• Berger & Heath (2007) and Snyder & Fromkin (1980) - motivation to show off uniqueness is high when it is perceived to be socially profitable.

• Lynn & Harris (1997) - extent to which people pursue unusual objects can be influenced by their individual differences regarding the need for uniqueness.

• Maimaran & Wheeler (2008) / Berger and Health (2007) - situational cues activate the desire for uniqueness and specific identity

• Tian et al. (2001) - consumers often express uniqueness through goods as a means to develop and enhance their personal and social identities

MODEL AND HYPOTHESES

• H1: There is a positive relationship between a Virtual World user’s skill and their shopping attitudes within Virtual Worlds.

• H2: There is a positive relationship between a Virtual World user’s skill and their subjective norms regarding shopping within Virtual Worlds.

• H3: There is a positive relationship between a Virtual World user’s challenge level and their shopping attitude within Virtual Worlds.

• H4: There is a positive relationship between a Virtual World user’s challenge level and their subjective norms regarding shopping within Virtual Worlds.

• H5: There is a positive relationship between a Virtual World user’s desire for uniqueness and their shopping attitude within Virtual Worlds.

• H6: Virtual World shopping attitudes positively relate to intentions to purchase Virtual in Worlds.

• H7: Subjective norms regarding Virtual World shopping positively relate to intentions to purchase in Virtual Worlds.


Virtual World Consumer Behavior Model

HYPOTHESES 1 & 3

• H1: There is a positive relationship between a Virtual World user’s skill and their shopping attitudes within Virtual Worlds.

• H3: There is a positive relationship between a Virtual World user’s challenge level and their shopping attitude within Virtual Worlds.

• Flow Theory and Abuhamdeh & Csikszentmihalyi (2012)- Skill and challenge lead to optimal attitudes

SkillFlow

Challenge

Attitude

Flow Theory

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HYPOTHESES 2 & 4

• H2: There is a positive relationship between a Virtual World user’s skill and their subjective norms regarding shopping within Virtual Worlds.

• H4: There is a positive relationship between a Virtual World user’s challenge level and their subjective norms regarding shopping within Virtual Worlds.

• Virtual World Studies: Fuchs, Sornetter & Thurner (2014); Bornstein, Gneezy & Nagel (2002); Chesney, Chuah & Hoffman (2009); Mildenberger (2013), Bornstein et al. (2002); and Virtual World Management (2008)- say as skill and challenge increase users encounters will broaden.

Subjective Norms

SkillChallenge

Virtual World studies & social groups

+

Flow

HYPOTHESIS 5

• H5: There is a positive relationship between a Virtual World user’s desire for uniqueness and their shopping attitude within Virtual Worlds.

• Higgin’s (1987) Self Discrepancy Theory- consumers are motivated to purchase when there is a gap between actual self and ideal self.

• Ball & Taskes (1992) consumer possessions satisfy

• Tian et al. (2001) - consumers often express uniqueness through goods as a means to develop and enhance their personal and social identities

• Animesh et al. (2011) use avatar as physical body to satisfy the need to express themselves

AttitudeDesire for Uniqueness

Consumer Studies / Virtual Worlds Studies/ Desire for Uniqueness

+

HYPOTHESES 6 & 7

• H6: Virtual World shopping attitudes positively relate to intentions to purchase Virtual in Worlds.

• H7: Subjective norms regarding Virtual World shopping positively relate to intentions to purchase in Virtual Worlds.

• TRA-(Ajzen, 1975)- Attitudes and subjective norm have a positive association with intentions to purchase.

Intentions to purchase

TRA

Attitudes

Subjective Norms +


Virtual World Consumer Behavior Model

METHODOLOGY OVERVIEW

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Methods Description Notes

Research Design

• Survey• Non Experimental• Quantitative• Explanatory• Cross Sectional

• Survey are commonly used as to make a generalization of the population.

• No manipulation of predictor values, no cause and effect.

• Measure of what individuals think• Connect ideas• One point in time

Study Population

• New York- Gamers Virtual Worldusers age 18 &+

• Multiple states, various ages, genders, education, income level etc.----limited, not mirror image of real population

Level of Analysis

• Individual • Study request individual behaviors,attitudes and attributes

Sampling Technique

• Convenience sampling

• Gamers are targeted who have played the top most Virtual Worlds

Sample Size • 350 + • Hoyle (1995) suggests the largest sample size vs PLS-SEM requirements

METHODOLOGY: PROCEDURES FORINSTRUMENTS, CONTROL VARIABLES & DATA COLLECTION

• All instruments were taken from pervious studies relevant to areas such as consumer behavior and online shopping.

• All instruments had reliability and validity statistics within the approved acceptability ranges.

• All instruments were left as close to the original as possible but modified and adapted only to fit Virtual Worlds.

• The variables were operationalized as ordinal variables with 7-point Likert scales and reflective indicators with the exception of skill knowledge which was based on a 6-point frequency and usage scale.


• Control Variables based on demographics (Rose, 2010; Yee, 2006)

• Ensure population is matched to the real Virtual World population

• Provide further information regarding differences between the groups.

• Age (continuous variable), gender (dichotomous variable), and the Virtual World most commonly played (nominal variable)


• Qualtrics - a 3rd party company used to solicit the survey

• Uses an online sample process from traditional, actively managed market research panels and social media

• Leverages partner’s routers, digital fingerprints, randomized-prevent bias

• Uses forced response, targeted questions for audience selection and attention grabbers to ensure valid responses

• Incentives are $1.25 to each respondent

• Informed consent required


• Qualtrics & its panels will be required to adhere to all state, regional, & federal laws.

• They are members of ESOMAR, CASRO and other national organizations.

• They will require informed consent prior to the respondent beginning the survey.

• They will incorporate strict confidentiality tools into the surveys by disabling screenshots and circumventing the saving of images, video, or audio files.

• Database and data centers will not hold sensitive or confidential panelist information.

• Restricted authorization and equipment security enforced, monitored and controlled.

• All information will be secured via industry standard firewalls and stringent IT security policies & procedures.

The Institutional Review Board will evaluate these factors for approval prior the study.


• Sample size rules for PLS-SEM and SmartPLS software:

• Significance level of 5%, a statistical power of 80%, and R2 values of at least 0.25 (Wong, 2013)

• Minimum sample size

• Marcoulides & Saunders (2006) maximum number of arrows pointing at a latent variable (3 for attitude) is 59 samples

• Costellow & Osborne (2005) suggest 20 subjects per variable (120=6 variables times 20)

• Chin (1998) suggests 10 times the largest number of paths from independent variables going into a dependent variable (30=3 times 10)

• Hoyle (1995) suggests 100 to 200

Larger the sample the stronger the results; 350+ samples

DATA ANALYSIS

Structural Equation Modeling with Partial Least Squares

1. Reliability / Validity assessment for the Measurement Model

2. Structural Model Analysis / Hypotheses testing

SmartPLS is used for

Quantitative analysis

Reliability and validity during CFA

Bootstrap (this study will use 5000 samples for bootstrap)

Subsamples created with randomly drawn observations from the original set of data (with replacement) and estimates the path model.

High levels of statistical power even when dealing with complex models and small sample sizes

Researcher is familiar with this program

DATA ANALYSIS (MEASUREMENT MODEL)

Measurement Model• PLS-SEM test reliability / validity of Virtual World Consumer Behavior scales

(Virtual World User’s Skill, Virtual World User’s Challenge Level, Desire for Uniqueness, Virtual World Shopping Attitude, Virtual World Shopping Subjective Norms and Intentions to Purchase Virtual World Products) using AVEs, composite reliability and latent variable correlations.

• PLS-SEM tests reliability of indicators and internal consistency by analyzing outer loadings and reliability statistics (composite).

• Discriminate validity of indicators with cross loadings. Loadings higher than cross loadings or remove.

• PLS-SEM provides CFA statistics to ensure convergent validity each item must exceed the minimum loading criterion of 0.7, Hair et al. (2006), or removed from scale.

• Scale composite totals must be equal or greater 0.7 (Sarkar, Echambadi, Cavusgil & Aulakh, 2001) and AVEs above 0.5 (Fornell & Larcker, 1981) or a new scale is sought.

DATA ANALYSIS (STRUCTURAL MODEL)

Path Coefficients, T statistics and significance for the links.

R squared values for all endogenous variables to depict how much of the variance is explained from the exogenous latent variables. 0.75 + substantial; moderate 0.75 - 0.25; weak < 0.25

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Structural Model Assessment

LIMITATIONS OF THE RESEARCH

• Virtual Worlds are new and changing

• Bias from online solicitation

• Audience is 18 years / New York / English

• One collection

• Does not test / prove casualty

Full / clear instructions to prevent some bias

Qualtircs implements figure printing & undesired response behaviors

Continue building from this research

IMPLICATIONS OF THE RESEARCH

First Virtual World Consumer Behavior Model

Leads future studies (Information System research)

Identify areas to target sales, prioritize, develop system components

Determine how businesses can make profits

Desire for uniqueness

Designers can fashion their games

Marketing and advertising for businesses emphasize unique concept

Business look for ways to maximize uniqueness in products

First to link Flow components with Virtual World consumer behavior

Link system skill to a shopping attitude rather than a system skill to a system attitude- apply similar techniques

Researchers can integrate results to behavioral studies to exploit ways to breakdown the factors associated with Virtual World users.

QUESTIONS

• Mine

• The So What-how to make someone care

• Trade off- worldwide vs small location

• How much scale modification is too much

• Yours

• ???

Documents

VIRTUAL WORLD CONSUMER BEHAVIOR DISSERTAION